Billy Beane: The Man Behind Moneyball

by on March 7th, 2015
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Billy Beane, who was once considered a sure thing as a player in the eyes of many baseball scouts, will go down as one of the most innovative general managers in the history of the game of baseball. While his ideas may have been initially perceived as ludicrous to the sports world, they were in fact ingenious in the way that they reevaluated the weight of players’ statistics. He created a brand new way of thinking called Moneyball, which allowed a team with a small budget to put together a roster as talented as the bigger, wealthier teams. Beane recognized the subjective nature of how baseball players were being paid and determined that by prioritizing different statistics, he would be able to afford players that were being undervalued in the world of baseball. Billy Beane successfully reinvented a system that had been introduced in the late 1800s and had served as the baseball standard for decades. While doing this, he used skills of persuasive communication that were key to his ability to accomplish this impressive feat. Using charisma, intrinsic ethos, expertise and credibility, while also being a cultural myth both in the possibility of success and the wisdom of the rustic, he was able to go against the social proof that was traditional Major League Baseball and has since changed the way it is being managed.

Beane, who works for the small-market Oakland Athletics also known as the A’s, told the media and, more importantly, his owners that he needed more money to compete with the big-market teams. That was until he realized statistics such as stolen bases, runs batted in, and batting average, typically used to gauge players, are old and outdated views on the game. He soon recognized that thorough statistical analysis had confirmed that on-base percentage and slugging percentage are better guides of offensive success. Beane became confident that these traits were cheaper to get than the more traditionally prized qualities such as speed and contact.

In an interview with Howard Bryant of ESPN.com, Beane relates his theory to the following: “It’s all about evaluating skills and putting a price on them. Thirty years ago, stockbrokers used to buy stock strictly by feel. Let’s put it this way: Anyone in the game with a 401(k) has a choice. They can choose a fund manager who manages their retirement by gut instinct, or one who chooses by research and analysis. I know which way I’d choose.”[1] Beane compares his theory to stocks because he is trying to make people on the business side understand what he is doing. When people choose a fund manager to manage their retirement, they want someone who is using research and analysis to determine what is best for their client. They do not want someone to just say, “I feel this is best because that’s what my gut is telling me.” That is what baseball was doing before Beane’s theory. The scouts determined who was going to be good and whom they wanted to draft or sign based on their gut and looking at the players five tools: speed, quickness, arm strength, hitting ability and mental toughness.

The problem with this method is that the scout is basically taking a guess on whether the player will be successful or not. There are too many variables involved and not enough solid research to determine which aspects of the players’ game are most valuable to winning. What Beane did was simplify the formula by asking only two questions: ‘Does this player get on base?’ and ‘Can he hit?’ He found these two factors to be highly correlated to overall wins when he did the research and stopped using his gut.

The previous quote shows Beane’s charismatic genius in the way he communicates his ideas through relatable comparison. He is able to make the media and the general public believe in him through his descriptive examples and effortless humor. When he projects his ideas into the realm of a businessman’s mind, he surprises the public with his fortitude and elicits a playful reaction. The quote demonstrates Beane’s colloquial manner, which enhances his charisma and establishes his intrinsic ethos. His down-to-earth demeanor is key to the development of his intrinsic ethos, or character. It is important that the public is able to relate to Beane because his ideas are so unconventional, and since baseball is one of the US’s most well known pastimes, the idea of disrupting the way it is managed is a delicate issue. He gains everyone’s respect through his outright knowledge but also manages to ensnare the public’s interest through his honorable qualities. He projects an air of confidence through his ability to adapt to the jargon of his audience and therefore, make a more compelling case because of his personality.

These qualities are related to Beane’s image. According to Larson, “Sometimes persuaders are successful because of their image or charisma. Somehow they seem to have a special presence, and they command the public’s attention. We believe them because their presentations are convincing and dynamic.”[2] What Larson is saying is that people do not just listen to the words that someone says but rather they look at the person as a whole. Was the presentation well prepared? Do they look good while they are saying it? These are important factors to the public, and if they see that the persuader, in this case Beane, presents his argument in a well thought out way and in a professional manner, then they are more apt to put their faith in him.

In the book, The Laws of Charisma by Kurt W. Mortensen, charisma is defined as, “the ability to empower and persuade others to believe in you, trust in you, and want to be influenced by you. In essence, you’re a source of empowerment, encouragement, and inspiration.”[3] Mortenson discusses charisma and shows that in a way, charisma is simple to describe but it is not common to possess. Having the ability to persuade someone is no easy feat but being charismatic is a big part of it. If you can have people trust in you and believe that what you are saying is best, then you will be successful. That is one of the most important and difficult things someone can learn to do, and it is something that Beane used to his advantage.

Beane is clearly charismatic in the way that he speaks because he was able to persuade the entire Oakland A’s organization to buy into his way of thinking. Not only that, but he had to persuade the players that he had their best intentions in mind rather than just trying to save money. To be able to persuade others, the first person Beane had to persuade was himself. He had to know that what he was doing was best for the team. In Persuasion: Command Attention. Hold Their Interest. Get What You Want, author Tom Gorman says that to persuade someone else the first person to persuade is yourself. “You’ll have a hard time persuading someone to back your proposal if you lack confidence in it. Belief is contagious, and so is disbelief.”[4] This is something that is a major part of being able to persuade someone else. Beane had to be confident in himself and know that what he was saying was right in order to persuade others to believe in him. If there was not sincerity in his belief of his own abilities, then no one else would have believed in his ideas either.

Beane achieved confidence and was able to present a strong argument due to his expertise and credibility. Jim Kouzes and Barry Posner talk about credibility in their book Credibility How Leaders Gain and Lose It and Why People Demand It. “Credibility is the foundation of leadership. People have to believe in their leaders before they will willingly follow them. Credibility is about how leaders earn the trust and confidence of their constituents.”[5] Basically, credibility is what makes you trustworthy. If Beane was the general manager of a World Series team, then he would have credibility in the field of baseball. If he had graduated with a law degree from Harvard, then he would be a good pick to be the team’s lawyer. Expertise and credibility are determined through the combination of educational and experiential background, which mandate if a person is knowledgeable on a certain topic.

Beane possesses both expertise and credibility due to his studies at UC San Diego in Economics. The University of California, San Diego is currently ranked 15th in the world by the Academic Ranking of World Universities. The Washington Monthly ranked UCSD 1st best overall in the nation when incorporating additional societal benefits other than just research impact as a metric, and 8th in the U.S. in terms of research alone.[6] Obviously, the rankings of his alma mater add to Beane’s credibility and expertise of economics and business. People are more apt to believe him from an economic standpoint because he received such an exceptional education focused on this field.

Beane used his expertise in 2006 when the A’s ranked 24th of 30 major league teams in player salaries but had the 5th-best regular-season record. Due to his team’s success in spite of its small payroll, Beane, his hand-picked assistant, Paul DePodesta, and the organization’s baseball philosophy became the subject of Michael Lewis’ best-selling book, Moneyball: The Art of Winning an Unfair Game. This book opened the eyes of many of the top sports executives and business CEOs in the nation to Beane’s new techniques. Due to this, Beane frequently is invited by top companies to talk about his management method of recognizing and using underrated assets to generate and maintain a competitive edge. He also sits on the board of directors of several companies, including Bell-Easton Sports, ProTrade and NetSuite, Inc.

Among Beane’s accomplishments, he was named The Sporting News’ Executive of the Year in 1999. That same year, Sports Illustrated named Beane as number 10 on its list of the Top 10 GMs/Executives of the Decade in all sports. In November of 2001, Beane was named one of Street & Smith’s Sport Business Journal’s “40 Under 40″ list, honoring the nation’s top 40 sports executives under the age of 40. He then earned Major League Baseball’s Executive of the Year honors by Baseball America magazine following the 2002 season. Beane was also invited to speak at Rupert Murdoch’s News Corp. management retreat in Pebble Beach, Calif. in 2006. The event focused on issues such as volunteerism, technology and politics, and featured leaders from around the world. Among the notable people who attended were British Prime Minister Tony Blair, Israeli Vice Premier Shimon Peres, former President Bill Clinton, former Vice President Al Gore, former House Speaker Newt Gingrich, former Harvard President Lawrence Summer and U2 lead singer Bono. Last year, Beane also collaborated with Gingrich and Sen. John Kerry in co-authoring an article in the New York Times, which offered possible remedies for the U.S. health care crisis.[7] These amazing honors give Beane credibility from a business standpoint to almost anyone in the world.

Beane possesses expertise and credibility in baseball, with the players in particular, due to his playing experience. He was drafted in 1980 and made his debut in 1984. Beane played parts of six seasons as a reserve outfielder in the major leagues, with the Mets, the Minnesota Twins, the Detroit Tigers, and the Athletics. Struggling to make the big league roster in 1990, Beane approached A’s General Manager Sandy Alderson during spring training and asked for a job as an advance scout. Beane held this position through 1993, becoming Assistant General Manager of the A’s in 1994 and ultimately becoming General Manager in 1997.

Beane’s time in Oakland has consistently seen him go against social proof. Cialdini states that, “the principle of social proof states that one important means that people use to decide what to believe or how to act in a situation is to look at what other people are believing or doing there.” Cialdini also states that, “Social proof is most influential under two conditions. The first is uncertainty. When people are unsure, when the situation is ambiguous, they are more likely to attend to the actions of others and to accept those actions as correct. In ambiguous situations, for instance, the decisions of bystanders to help are much more influenced by the actions of other bystanders than when the situation is a clear-cut emergency. The second is similarity.“[8] Cialdini shows that social proof is the idea that what others are doing must be what is the right action. When people are out in public and they do not know how to react to something, they look to others to best decide their actions. People assume something is okay because they see others doing it. An example of this is if a woman is attacked and nobody does anything because they think that somebody else is going to do help her or they simply do not want to be bothered.

For years the social proof of baseball was that if you spend more money, then you would win the most games and have the best players. The New York Yankees, for example, spend more than any other team and have had impressive results by playing in the most World Series (40) and by winning the most as well (27). Beane went against that and, in fact, proved that you do not need to spend the most to win games. By changing the method that manufactures wins on the field, the 2002 Athletics, with $41 million in salary, were able to compete with teams such as the New York Yankees, who spent over $125 million in payroll that same season. Overall, under Beane’s watch, the A’s have compiled a 976-804 (.548) record over the last 11 seasons, which is the third-best record in the American League and fifth best in all of baseball during that time frame.

Yet another way we see Beane go against the social proof is during the Major League Baseball player draft held each June. The draft process involves fifty rounds of selections by all thirty teams. Each team collects their entire executive team, including their general managers, scouts, and professional advisors, to decide which players should be drafted. The higher the player is chosen the more valuable he is believed to be by the team, which makes the process to choose players very important. According to Lewis, in Moneyball, there are two main theories that are being used to narrow the selection process.

The first theory is considered by most to be the “old or original” scouting theory. Scouts go out and evaluate players all over the country. During this period, they don’t pay attention to statistics, but instead they base decisions on the five tools: speed, quickness, arm strength, hitting ability and mental toughness.[9] In comparison, the second theory is based on Beane’s way of thinking. The Moneyball theory places no importance on the body of the athlete or the physical tools that the athlete possesses but rather asks two questions: ‘Does this player get on base?’ and ‘Can he hit?’ According to Lewis, Billy Beane decided to base his drafting of position players/hitters on two core statistics: on-base percentage (OBP) and slugging percentage. These two stats combined to form a new statistic called on-base plus slugging (OPS).

Another way that Beane’s approach went against the social proof was his lack of emphasis on power. Beane believed that power could be developed, but patience at the plate and the ability to get on base could not.[10] Beane’s theory was created based on the works of a sabermetrician named Bill James. “Sabermetrics is the mathematical and statistical analysis of baseball records.”[11] Bill James defined sabermetrics as “the search for objective knowledge about baseball.” Sabermetrics attempts to answer objective questions about baseball, such as ‘Which player on the team contributed the most to the team’s offense?’ or ‘How many home runs will this player hit next year?'[12]

Beane gave up playing baseball at an age when most just come into their prime, which is a great example of him going against social proof. In 1990, he was a 27-year-old outfielder with the Oakland A’s. It was at this point that he walked into the A’s front office and said he wanted to quit playing and become an advance scout. As Lewis notes in Moneyball, nobody ever quits the bigs
at age 27 to become a scout, but Beane wanted to be the guy running the show. 



Moneyball tells the story of how Beane became general manager of the A’s and transformed the club along sabermetric lines. “We just stole these ideas from people smarter than ourselves,” he said recently, then corrected himself: “Stole, that’s the wrong word.”
Beane hired smart young statisticians, like 24-year-old Harvard grad Paul DePodesta, to find undervalued players and to further Billy Beane’s knowledge of sabermetric at the same time. As Moneyball shows, stats worked for the A’s. While other teams did things because it worked in the past, the A’s, because of Beane, came up with new ways of running a baseball team.

As previously stated, social proof works best under two conditions, uncertainty and similarity. There is no doubt that whenever Beane went against social proof he was always uncertain, especially in the example of how he goes about signing players and drafting players while using the sabermetric system. Never before had people done what Beane wanted to do in any of these situations where he goes against social proof. Beane had a revolutionary view on things and he clearly persuaded others. Following the release of Moneyball, where executives were given the chance to see how Beane controlled the A’s front office, his impact on the game has been undeniable. Since it’s release, teams such as the New York Mets, New York Yankees, San Diego Padres, St. Louis Cardinals, Boston Red Sox, Washington Nationals, Arizona Diamondbacks, Cleveland Indians, and the Toronto Blue Jays have all hired full-time sabermetric analysts.

Beane is the premiere example of the underdog story. He was a cultural myth both in the possibility of success and the wisdom of the rustic. The possibility of success “reflects the power of our hopes for the American dream of success.” Essentially, the American dream is to have a good job and be successful, while maintaining the freedom of pursuing one’s own passions. In high school, Beane excelled at basketball, football, and baseball on his school’s teams. However, he made the decision to focus his talent on baseball because that was his passion. In 1980, by the time Beane was ready to graduate, he had received an offer from Stanford University to play both baseball and football on a joint scholarship and was drafted by the New York Mets. Beane chose to sign with the Mets under a $125,000 contract; it was the only decision he ever made solely about the money. Beane went on to play parts of seasons as a reserve outfielder for 5 years. He decided to end his playing career and asked for a job as a scout for the A’s. [13]

Beane believed in his possibility of success because he realized he was not good enough as a baseball player but that did not mean he could not impact the game. He decided that he wanted to take charge of a team and still succeed, not only in life but in baseball as well and with his background in economics from UC San Diego, this gave him yet another possibility of success. He never backed down, and learned an important lesson from accepting a path in life based on money: that it is not the only factor within the American dream. He realized that he had undervalued the happiness and self-worth that receiving a scholarship offer had given him. This cathartic moment stirred the passion within Beane to shake up the game of baseball and stick to his dream, without being misled by the promise of money. This is why Beane has stuck with the A’s for the past 13 years as General Manager. He was offered the position of GM for the Red Sox in 2002, which promised an astounding salary, but Beane stuck with his team because he believed in his possibility of success.

The other cultural myth previously stated that Beane encompasses is the wisdom of the rustic. The wisdom of the rustic is the “premise that no matter how devious the opposition, simple common sense wisdom of the backwoods hero or heroine wins out.” It is the ultimate tale of the underdog. Even though the A’s did not have the budget of the bigger Major League teams, Beane knew that their success should not be based on whether or not they could afford to pay a player. He realized that the game did not have to be based on capitalism. Since the late 1800’s, the game of baseball had not changed much; it is a major American tradition, which holds historical and cultural implications for the US. Because Beane’s idea of looking at different kinds of statistics had the potential to disrupt the way baseball teams are managed, he was looked at as an opponent to American tradition and that, in itself, made him an underdog. He was going against something that had never been challenged before. It does not matter how much people wanted to resist what Beane was unleashing on baseball. Because he had the wisdom of the rustic, that baseball should not be ‘moneyball’, he was going to come out on top according to Larson.[14]

Billy Beane has been able to accomplish astounding change in the game of baseball during his career as General Manager of the Oakland Athletics due to his ability to persuade the public. He was able to spread his ideas and convince others to believe in his new techniques by his use of charisma, intrinsic ethos, expertise, credibility, and most importantly by his willingness to go against the social proof in uncertainty, while also being a cultural myth both in possibility of success and the wisdom of the rustic. Doing all this was a risk but it has proven to be successful and has made him a pioneer. While unfortunately he has yet to win a world series using his theory, another team took it and made it work. When The Red Sox promoted Theo Epstein to general manager and then hired Bill James to use Sabermetrics, they won the World Series in 2003. If it weren’t for Billy Beane, the Red Sox would have never hired Bill James and who knows, maybe The Curse of the Bambino would still be going. These things will never be known, but without Billy Beane baseball definitely would not be what it is today. Players, who were given a chance to play because of Beane’s idea, may have never had a shot, and we may not have ever seen the Athletics go on to become one of the most successful, undervalued teams in the major leagues.

[1] http://sports.espn.go.com/espn/otl/columns/story?columnist=bryant_howard&id=4357166

[2] Larson, Pg 245

[3] The Laws of Charisma by Kurt W. Mortensen Pg 3

[4] Persuasion: Command Attention. Hold Their Interest. Get What You Want‬ By Tom Gorman Pg. 6

[5] Credibility How Leaders Gain and Lose It and Why People Demand It by James M. Kouzes Barry Z. Posner Pg. ix

[6] http://www.washingtonmonthly.com/college_guide/rankings_2010/national_university_rank.php

[7] http://mlb.mlb.com/oak/team/exec_bios/beane_billy.jsp

[8] Page 139 Cialdini

[9] Major League Baseball, 2001 p. 10-14

[10] An Examination of the Moneyball Theory: A Baseball Statistical Analysis ISSN: 1543-9518

[11] James, B. (1982). The Bill James Baseball Abstract 1982. New York: Ballantine
Books. Pg. 3

[12] The Sabermetric Manifesto by David Grabiner (1994)

[13] Moneyball by M. Lewis

[14] Larson pg. 23

References

Bryant, H. (2010, January 15). Oakland A’s general manager Billy Beane stays the course through backlash from “Moneyball” critics – ESPN. ESPN: The Worldwide Leader In Sports. Retrieved December 2, 2011, from http://sports.espn.go.com/espn/otl/columns/story?columnist=bryant_howard&id=4357166

Cialdini, R. B. (2009). Influence: Science and Practice (5 ed.). New York: Pearson.

Friedman, D., & SI.com. (n.d.). NFL’s Scott Pioli is decade’s top personnel executive in sports – 2000s: The Decade in Sports. SI.com. Retrieved November 28, 2011, from http://sportsillustrated.cnn.com/2009/magazine/specials/2000s/12/19/top.executives/index.html

Gorman, T. (2007). Persuasion: Command Attention. Hold Their Interest. Get What You Want. Avon, MA: Adams Media.

Grabiner, D. (n.d.). The Sabermetric Manifesto. Sean Lahman | Database Journalist. Retrieved November 27, 2011, from http://baseball1.com/baseball-archive/sabermetrics/sabermetric-manifesto/

James, B. (1982). Introduction. The Bill James baseball abstract, 1982 (p. 3). New York: Ballantine Books.

Kouzes, J. M., & Posner, B. Z. (2011). Introduction: On Credibility and the Restoration of Trust and Confidence. Credibility: how leaders gain and lose it, why people demand it (p. ix). San Francisco, Calif.: Jossey-Bass.

Larson, C. U. (2010). Persuasion: reception and responsibility (12 ed.). Belmont, Calif.: Wadsworth Pub. Co..

Lewis, M. (2003). Moneyball: the art of winning an unfair game. New York: W.W. Norton.

Major League Baseball Scouting Pamphlet (pp. 10-14). (2011). Scouting. Ontario, CA: Major League Scouting Bureau.

Mortensen, K. W. (2010). Introduction. The laws of charisma: how to captivate, inspire, and influence for maximum success (p. 3). New York: AMACOM ;.

National University Rankings 2010 | Washington Monthly. (n.d.). The Washington Monthly. Retrieved November 28, 2011, from http://www.washingtonmonthly.com/college_guide/rankings_2010/national_university_rank.php

Oakland A’s: Executive Profiles. (n.d.). The Official Site of Major League Baseball | MLB.com: Homepage. Retrieved November 27, 2011, from http://mlb.mlb.com/oak/team/exec_bios/beane_billy.jsp

Passan, J. (n.d.). Rethinking Moneyball. Yahoo! Sports. Retrieved November 29, 2011, from http://sports.yahoo.com/mlb/news?slug=jp-moneyball081706

Wassermann, E., Czech, D., Wilson, M., & Joyner, B. (n.d.). An Examination of the Moneyball Theory: A Baseball Statistical Analysis. volume 14 | The Sport Journal. Retrieved November 28, 2011, from http://www.thesportjournal.org/article/examination-moneyball-theory-baseball-statistical-analysis


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